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Minor Neice Inheritance Question

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K

Karak

Guest
My daughter is the named beneficiary on her uncles 401k and life insurance. The life insurance told me it the proceeds would be put in a trust until she was 18 and I don't know about the 401k yet. My question is if there is no will, who will become the trustee or custodian and will this need to go through probate to determine that. If not and there are just trusts set up throught the insurance co. and retirement plan is it possible to transfer these to another trust where we as her parents can put some restictions on the inheritance so she doesn't receive such a large sum of money at 18, which I feel is too young. Thanks for any advice. Still so confused as this is unchartered territory.

Kara
 


ALawyer

Senior Member
You can't now set up a binding plan to force her to delay her receipt of what is HER money. But I recognize and have often seen the problem of too much, too soon, before education or wisdom, spoiling a child and/or destroying motivation. So until she turns 18 it is YOUR job to inculcate a sense of maturity, motivation and responsibility.

The insurance company and manager of the 401k plan typically hold the money at interest until she is no longer a minor, and then she gets the money. Sometimes if you get a cort order, you can have the funds transferred to a trust for the child so investment of the funds produces a better yet safe return, although with all the stock market volatility, who knows.

What you can do is get the child to MORALLY commit to lock the money up at age 18, perhaps in a 3 party managed trust under the control of her, you and her other parent, with the interest only paid out until she is 21 or gets a degree, etc. and on her 18th birthday, get her to sign a formal document transferring the money to the trust BEFORE she chagnes her mind It may take a bit of incentive and blackmail, but, heck, partents may be aware of how to do it. See a lawyer in your area and perhaps s/he will have another approach.
 
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Dandy Don

Senior Member
You forgot to mention what state the decedent died in.

Trusts are designed for privacy and to avoid probate, so there is no public record of it, like there would be for a will. Most of the assets are put into the trust, so there is usually no need for a will, but sometimes it does happen that the person wants a will AND a trust.

Check at the county courthouse to see if a wil has been filed. If it has been, the name and address of the estate executor will be in the file, or if you already know who the executor is, then contact that person for more information, since they probably know the trustee.

If there is no will, then the estate administrator will be whatever family member or h ired attorney is the first one to file paperwork at the courthouse to open the estate.

Perhaps you should be asking the insurance company who the trustee is, if they know. If the uncle has already set up a trust then he already pre-selected a trustee, and that person is probably busy right now managing the business affairs of the trust. In the very near future (within a month or so), this trustee should be contacting you to give you the information about your daughter's trust, if he was given her or your mailing address and/or phone number.

Isn't there someone in the family who would know this and perhaps has already begun to start taking care of his affairs? Hasn't someone already gone through his home to look for personal documents?

DANDY DON
 

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